CG Technology resolves illegal gambling case for $22.5m
CG Technology will pay $22.5 million (€20.1 million) to resolve investigations into past involvement in illegal gambling and money laundering in the US.
According to the Reuters news agency, the firm, an affiliate of financial services company Cantor Fitzgerald, agreed to pay $16.5 million and enter into a non-prosecution agreement three years after a former executive pleaded guilty to conspiring to take part in an illegal gambling business.
The US Treasury Department's Financial Crimes Enforcement Network has also announced a separate $12 million civil penalty against the firm, with $6 million of this to be covered by the criminal settlement.
According to prosecutors, from 2009 to 2013 the sports betting technology firm, which was then known as Cantor Gaming, aided and abetted operation of an illegal gambling business and money laundering, while establishing itself as one of the largest race and sportsbook operators in the US.
Brooklyn US attorney Robert Capers said: “Unacceptably, this growth came at the expense of compliance with the law, and as a result Cantor Gaming became a place where at least two large-scale illegal bookmakers could launder their ill-gotten proceeds.”
Prosecutors also said that Cantor Gaming offered higher betting limits than rival operators in an effort to attract and retain punters, while also granting certain customers preferential treatment, such as direct access to Michael Colbert, the firm’s director of risk management.
Colbert and his staff are said to have facilitated illegal conduct, such as allowing the use of ‘runners’ to place bets for third-parties, as well as processing large cash deposits, withdrawals and third-party wire transfers, in the knowledge that the funds represented the illegal proceeds.
In 2014, Cantor Gaming agreed to pay $5.5 million to resolve related allegations by the Nevada Gaming Control Board, while in August of this year, Lee Amaitis stepped down as chief executive after the company agreed to pay $1.5 million to settle separate claims by the Nevada regulator over issues with a computerised system that resulted in patrons being incorrectly paid.
CG Technology is yet to comment on the latest settlement.
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